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Call Updates

Dominion - D - close: 75.02 change: -0.76 stop: 74.49

Tuesday was a rather bleak day for shares of D. The stock slipped through out the session and hit a low of $74.58 before the very late afternoon market bounce appeared and probably saved us from being stopped out. Monday's trip above the $76.00 level is looking like a bull trap. We are not suggesting new plays with D under $76.00. Our target is the $81.00-82.00 range although more conservative types may want to exit near $80.00. Please note that we do not want to hold over D's early August earnings report.

Picked on July 17 at $ 76.05
Change since picked: - 1.03
Earnings Date 08/03/06 (confirmed)
Average Daily Volume = 1.5 million

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EOG Resources - EOG - close: 66.88 change: -0.57 stop: 69.90

Oil stocks turned in a mixed performance today but overall the trend was negative with another 2.3% decline in crude oil following Monday's sell-off. The excuse today for crude's decline was the idea that the current Middle East conflict would not spread to oil-producing countries. The intraday bounce from EOG's simple 50-dma is encouraging but we're still on the sidelines and a long way from being triggered at $72.55. Nimble and aggressive traders might consider buying a bounce from current levels but EOG needs to breakout from its short-term trend of lower highs.

Picked on July xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 08/01/06 (confirmed)
Average Daily Volume = 3.5 million

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Fortune Brands - FO - close: 70.74 change: +0.19 stop: 69.74

FO continues to trade sideways and thus far is honoring support at the $70.00 level. That's a positive sign considering the weakness in the retail sector following Target's sales warning today. We are not suggesting new positions at this time. FYI: We still don't have a confirmed earnings date yet. One source says FO is due to report on July 28th. We may end up exiting on Thursday. We'll let you know tomorrow.

Picked on July 06 at $ 71.30
Change since picked: - 0.56
Earnings Date 07/21/06 (unconfirmed)
Average Daily Volume = 674 thousand

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Reynolds American - RAI - close: 120.37 chg: +0.55 stop: 117.45

The action in RAI on Tuesday looks like a new bullish entry point to buy calls. Traders were relatively quick to buy the dip near the stock's rising 10-dma this afternoon and the close over the $120 level is a positive sign. We would have liked to have seen more volume. Our short-term target is the $124.50-125.00 range.
We have a limited amount of time for this play to work since we plan to exit ahead of the late July earnings report.

Picked on July 17 at $120.20
Change since picked: + 0.17
Earnings Date 07/26/06 (unconfirmed)
Average Daily Volume = 636 thousand
 

Put Updates

Alcon Inc. - ACL - close: 93.83 chg: -0.85 stop: 100.05

Shares of ACL continue to show relative weakness. The stock lost 0.89% to close at another relative low on Tuesday. The close under June's low of $94.44 is a good sign for the bears. We're suggesting two targets. Our conservative target is the $90.50 mark. Our aggressive target is the $87.00-85.00 range. We do not want to hold over the July 24th earnings report so we don't have a lot of time.

Picked on July 13 at $ 95.61
Change since picked: - 1.78
Earnings Date 07/24/06 (confirmed)
Average Daily Volume = 805 thousand

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Air Products Chem. - APD - close: 61.90 chg: +0.39 stop: 65.01

APD managed a bit of an oversold bounce today but the rally failed to breakout past the $62.00 level and its simple 200-dma. We're not sure if it's significant but today's session did produce a bullish engulfing candlestick pattern. At this time we remain bearish and continue to target the $59.00-58.00 range.

Picked on July 09 at $ 62.95
Change since picked: - 1.05
Earnings Date 07/26/06 (confirmed)
Average Daily Volume = 1.2 million

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Apollo Group - APOL - close: 48.49 chg: -0.35 stop: 51.01 *new*

Good news! Earlier we mentioned that readers could look for a failed rally under $50 or its 10-dma as a new entry point. Well, APOL provided that failed rally today. More conservative traders may want to wait and see how the market reacts to tomorrow's CPI report before initiating new positions. We're going to lower our stop loss to $51.01. Our target is the $45.50-45.00 range. The P&F chart points to a $40.00 target.

Picked on July 09 at $ 49.92
Change since picked: - 1.43
Earnings Date 09/19/06 (unconfirmed)
Average Daily Volume = 1.4 million

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Cardinal Health - CAH - cls: 63.50 chg: +0.30 stop: 65.25

CAH is still consolidating sideways. Aggressive traders might want to consider buying puts on a failed rally under $65.00. We're going to stick to our plan with a trigger at $62.25. If triggered then we'll target a decline into the $57.75-57.00 range. More aggressive traders might want to aim for the $55 region. The P&F chart points toward $40. We do not want to hold over the early August earnings report.

Picked on July xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 08/03/06 (confirmed)
Average Daily Volume = 1.6 million

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Caterpillar - CAT - close: 69.47 chg: +0.58 stop: 72.31 *new*

CAT hit a new four-week low today before the last minute market rally pushed shares into the green again. Today's bounce from the $68.00 level is somewhat concerning and we've been warning readers that if the DJIA bounces CAT will probably follow. We only have a few days left before CAT reports earnings. We're not suggesting new plays at this time and we are choosing to adjust our stop loss to $72.31. Our target is the $67.50-66.50 range, which is just above the rising, simple 200-dma.

Picked on July 12 at $ 71.31
Change since picked: - 1.84
Earnings Date 07/21/06 (confirmed)
Average Daily Volume = 5.1 million

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Express Scripts - ESRX - cls: 70.10 chg: -0.57 stop: 71.51

ESRX was moving our direction (lower) until the late day market rally that pushed shares back above the $70.00 level. Overall the technical picture still looks bearish but we're concerned that if the market rallies ESRX will follow! Our target is the $64.50-64.00 range. We do not want to hold over the July 26th earnings report.

Picked on July 17 at $ 69.30
Change since picked: + 0.80
Earnings Date 07/26/06 (confirmed)
Average Daily Volume = 2.0 million

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IDEXX Labs - IDXX - close: 73.61 chg: +0.55 stop: 76.51

There is no change from our previous updates. Traders should strongly consider locking in some profits. If the market rallies on the CPI report or something said by Bernanke tomorrow then IDXX could definitely produce an oversold bounce. We're not suggesting new positions. Our conservative target at $75.25 has already been hit and we're aiming for the $72.00 level.

Picked on June 12 at $ 77.95
Change since picked: - 4.36
Earnings Date 07/28/06 (unconfirmed)
Average Daily Volume = 144 thousand

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Jacobs Engineering - JEC - cls: 72.99 chg: +1.11 stop: 77.55

JEC produced a strong bounce today. Actually the stock produced an intraday double-bottom near $70.85. At this time we would expect the bounce to continue and for JEC to hit the $74.00-75.00 region. The simple 200-dma near $75.40 should offer overhead resistance. Wait for the rebound to roll over before considering new positions. Our target is the $69.00 level near the June lows. More conservative traders may want to exit at $70 while aggressive traders may want to aim lower. Bear in mind that we do not want to hold over the July 25th earnings report so we only have a few trading days.

Picked on July 16 at $ 73.75
Change since picked: - 0.76
Earnings Date 07/25/06 (confirmed)
Average Daily Volume = 583 thousand

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Lazard Ltd. - LAZ - close: 34.40 chg: -0.60 stop: 36.75

There were a number of earnings reports in the investment-sector today with MER, SCHW, BLK, AMTD and JEF all reporting. Yet the news failed to rally inspire any buying, except for AMTD, which rallied strongly. Shares of LAZ definitely under performed its peers and the market with a 1.7% decline today. Our trigger to buy puts was at $34.49 so the play is now open. However, readers might want to be patient. LAZ was trading up from its lows late this afternoon and we wouldn't be surprised by a bounce toward $36. A failed rally near $36 would be an attractive entry point to buy puts. Our target is the $31.00-30.00 range. We do not want to hold over the early August earnings report.

Picked on July 18 at $ 34.49
Change since picked: - 0.09
Earnings Date 08/08/06 (unconfirmed)
Average Daily Volume = 504 thousand

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Panera Bread - PNRA - close: 59.41 chg: -1.30 stop: 62.01

Shares of PNRA continued to sink on Tuesday and the stock hit a new eight-month low with today's 2.1% decline. Volume came in pretty strong on the sell-off, which is normally bearish. Our trigger to buy puts was at $59.49 so the play is now open and our target is the $55.50-55.00 range. We do not want to hold over the July 25th earnings report.

Picked on July 18 at $ 59.49
Change since picked: - 0.08
Earnings Date 07/25/06 (confirmed)
Average Daily Volume = 494 thousand
 

Strangle Updates

None
 

Dropped Calls

None
 

Dropped Puts

Whole Foods - WFMI - close: 56.78 chg: -2.14 stop: 63.01

Target achieved. Investors were already nervous about a slow down in the consumer due to high fuel costs and today's sales warning from Target (TGT) prompted a sharp sell-off in retail stocks. Shares of WFMI dipped to an intraday low of $54.66 before closing with a 3.6% loss on very strong volume. Our target was the $56.00-55.00 range.

Picked on July 12 at $ 61.20
Change since picked: - 4.42
Earnings Date 07/31/06 (confirmed)
Average Daily Volume = 1.4 million
 

Dropped Strangles

D.R.Horton - DHI - close: 20.00 change: -0.72 stop: n/a

Target achieved. Investors are also worried about a slow down in the economy and the housing sector. Today's news that homebuilders' confidence hit 15-year lows did not help matters. The DJUSHB index lost another 1.9% and leading the way was DHI, which fell another 3.4% today on big volume. The company is due to report earnings tomorrow. Our plan was to exit if either option in our strangle hit $2.55 or more. Today the August $22.50 put (DHI-TX) hit a high of $2.90. Our estimated cost was $1.70.

Picked on July 09 at $ 23.90
Change since picked: - 3.90
Earnings Date 07/20/06 (confirmed)
Average Daily Volume = 3.7 million
 

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